Closing Gold & Silver Market Report – 3/2/2012
DOLLAR RISES ALONG WITH CONCERNS OVER MIDDLE EAST
Precious metals prices have remained relatively steady today with technical selling to balance investors’ books for week’s-end profit-taking. The dip in stock markets is attributed to many investors feeling the rally was moving faster than the actual global growth outlook. Money manager John Carey said, “Some people may think that the market is a bit ahead of itself after the rally in stocks. There’s concern about a potential slowdown as a result of Europe’s debt crisis. People seem to have been more relaxed about the situation in Europe, but when you look closely you see that the underlying issues remain unresolved.” The uncertainty in the markets and rise in dollar strength are generally good indicators for Gold prices.
Developments in the Middle East continue to cause concern. The Red Cross was being denied access to the Homs area in Syria, and Israeli military action against Iran remains a possibility. Red Cross President Jakob Kellenberger said, “It is unacceptable that people who have been in need of emergency assistance for weeks have still not received any help. We are staying in Homs tonight in the hope of entering Baba Amro in the very near future.” President Barack Obama issued his most direct threat of military action earlier today against Iran. Obama warned, “As president of the United States, I don't bluff.” Monday’s scheduled meeting between Obama and Israeli Prime Minister Benjamin Netanyahu is shaping up to be some of the most important talks between the nations in years. In the same interview, Obama said, “At a time when there is not a lot of sympathy for Iran and its only real ally (Syria) is on the ropes, do we want a distraction in which suddenly Iran can portray itself as a victim?”
U.S. wages are on the rise, which is increasing the likelihood of greater consumer spending through the year, with the hope that it will help increase the Gross Domestic Product. Rising incomes show that an improved labor market will provide people the financial ability to get out and spend. Consumer spending accounts for 70 percent of the economy. Chief U.S. economist Joseph LaVorgna said, “Consumers have a lot more firepower than we thought. … We should see stronger consumption over the course of the year. Things are moving in the right direction.”
At 4:15 p.m. (CST), the APMEX precious metals spot prices were:
- Gold - $1,712.90 – Down $9.80.
- Silver - $34.80 – Down $0.88
- Platinum - $1,700.50 – Down $1.60.
- Palladium - $715.80 – Down $1.00.